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Is there reserve fund in Lending Club or Prosper to protect investors?

Started by Peter, December 07, 2014, 11:00:00 PM

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qiosa

The P2P lending business model appeared first in the UK. Most platforms in the UK, such as Zopa, RateSetter,Wellesley and Lending Works, create reserve fund (with different names) to protect investors. It's funded by a contribution from the fee a borrower pays when their loan is approved. If a borrower defaults, the reserve fund will be used to cover any missed or late loan payments.
But I don't find any fund like this in the US platforms, such as Lending Club and Prosper. Who knows the reason?


Kombinator

Well technically lenders carry the default risk of LC and Prosper SPV:)

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